After weeks of public backlash, Bank of America announced today that it would cancel plans to charge a $5 monthly transaction fee for debit card purchases.

The bank has been under fire since it announced the fee in late September, further fueling the air of general distrust in major U.S. banks that has become increasingly palpable in the wake of the Occupy Wall Street protests. Earlier this month, Citibank also announced that it would be raising the minimum balance requirement for checking and savings accounts to avoid a monthly fee of $15 or $20, depending on the type of account. Bank of America has cited the so-called “Durbin Amendment” of the Dodd-Frank Act as the reason for imposing the debit card fees. The amendment, which the Senate passed last year, reduced the fees charged to merchants on debit card transactions, thereby limiting banks’ revenue from those purchases.
Many customers, however, have directed their ire at the banks, and the $5 fee announcement has served the breaking point for those already fed up with the practices of large financial institutions. In recent weeks, activists, including those involved in the Occupy Wall Street protests, have been ushering along a growing movement for people to close their accounts with large banks and transfer their money into a local financial institution or credit union. Videos of customers attempting to close their accounts with large banking institutions have gone viral online, and credit unions, the non-profit alternative to banks, have surged in popularity. One group has designated November 5 as “Bank Transfer Day” in an effort to persuade people to switch to credit unions en masse. Another movement, the Move Your Money Project, describes itself as a campaign to “empower individuals and institutions to divest from the nation’s largest Wall Street banks and move to local financial institutions.”

In addition to being the alternative to the “too big to fail” institutions, credit unions are attracting customers in droves because of lower interest rates on consumer loans and credit cards, lower minimum balance requirements for avoiding fees and the increased availability of free checking accounts, which are quickly dwindling from large banks. Whereas large banks have “customers,” credit unions have “members” that collectively own the union. Credit union profits are also reinvested to reward members and provide the services that run the union, while traditional banks primarily operate to benefit shareholders.

The public outcry against major U.S. banks has proven substantial enough to convince many of those banks to scale back plans to charge their own debit card transaction fees. Last week, Wells Fargo and J.P. Morgan Chase both announced that they would halt trial runs of their own debit card transaction fees. SunTrust Banks and Regions Financial Corp also dropped similar fees. But while the cancellation of debit card fees may appease current customers, it may not do much to lure back those whose view of the large banking industry has already soured.

President Obama, on the last leg of his tour through the western U.S., announced a series of measures to help ease the mounting burden of student debt on Americans.

Comments

Lily429

Banking is ultimately about convenience. Long term, that will drive decisions about where to bank.

http://www.facebook.com/people/Chris-Hewitt/744800681 Chris Hewitt

The first thing I notice in the picture is a big waste of butane. Use a branch as tinder! And it’ll probably save a few fingertips from getting burnt too…

Eaton T. Fores

Yeah, right, sure. Everything is “ultimately about” sloth and greed. We know that point of view already.

http://twitter.com/morrischris Christopher Morris

It’s so easy too to move your money to a credit union and definitely worth it. We just posted a song about it right here: http://youtu.be/KC8DIETX–k

Enjoy and please share!

Kevin McGee

Anti-BoA sentiment has been growing for many years, this is just one example among many. There have been several high-profile cases of BoA screwing people over, and I know several friends, family members and co-workers who become instantly enraged at the very mention of the name, because of their experience with them. Other times, someone has casually mentioned that they use BoA, and several nearby people will gasp in horror, and tell them that its only a matter of time before BoA screws them too.

http://pulse.yahoo.com/_KCTHO5CH3JW42WK4YL55IIVUNE David

Hey BOA…Day Late- dollar short….Go Eff yourself…..

http://pulse.yahoo.com/_KCTHO5CH3JW42WK4YL55IIVUNE David

Hey BOA…Day Late- dollar short….Go Eff yourself…..

Itsjustmeagain

The OWS
identifies banks and financial institutions as the villains, but it is the root
cause of the anger. If you need a poster child, it will be the Congress who has
turned their collective backs on the citizens who elected them. They are now
working for whoever has the deepest pockets and not Joe somebody.

The Karl
Rove coined expression “Class Warfare” is really “Economic
Warfare” with the middle class and poor fighting for their economic
survival. The atacks on unions, wages and overall financial health will take us back to 1910, before representation. They want a working class that is perpetually afraid for their jobs, where they are chattle to be disposed of at a whim.

Need to Know is a production of Creative News Group (CNG) in association with WNET. Marc Rosenwasser is Executive Producer. Need to Know is made possible by Bernard and Irene Schwartz, Mutual of America, Citi Foundation, John D. and Catherine T. MacArthur Foundation, Miriam and Ira D. Wallach Foundation, Margaret A. Cargill Foundation, The Corporation for Public Broadcasting and PBS.